SECRETARY KERRY'S RECENT REMARKS TO UN SECURITY COUNCIL ON SYRIAN CHEMICAL WEAPONS

FROM:  U.S. STATE DEPARTMENT 
Remarks at the United Nations Security Council
Remarks
John Kerry
Secretary of State
New York City
September 27, 2013

Thank you very much, and thank you, Mr. Secretary General, distinguished minister members of the Security Council.

Five weeks ago, the world saw rows upon rows of murdered children lying on a hospital floor alone or beside slain parents, all wrapped in un-bloodied burial shrouds. And the world’s conscience was shocked, but our collective resolved hardened. Tonight, with a strong, enforceable, precedent-setting resolution requiring Syria to give up its chemical weapons, the United Nations Security Council has demonstrated that diplomacy can be so powerful, it can peacefully defuse the worst weapons of war.

So tonight, we are declaring together, for the first time, that the use of chemical weapons, which the world long ago determined beyond the bounds of acceptable human behavior, are also a threat to international peace and security anywhere they might be used, anytime they might be used, under any circumstances. As a community of nations, we reaffirm our responsibility to defend the defenseless, those whose lives remain at risk every day that anyone believes they can use weapons of mass destruction with impunity. Together, the world, with a single voice for the first time, is imposing binding obligations on the Assad regime requiring it to get rid of weapons that have been used to devastating effect as tools of terror. This important resolution reflects what President Obama and President Putin and colleagues around the world set out to do.

I want to thank Foreign Minister Lavrov for his personal efforts and cooperation, beginning before Geneva and continuing through this week, so that we could find common ground. I also want to thank my good friends and counterparts, Foreign Secretary Hague and Foreign Minister Fabius, who have been partners every step of the way.

Our original objective was to degrade and deter Syria’s chemical weapons capability, and the option of military force that President Obama has kept on the table could have achieved that. But tonight’s resolution, in fact, accomplishes even more. Through peaceful means, it will for, the first time, seek to eliminate entirely a nation’s chemical weapons capability, and in this case specifically Syria’s. On-site inspections of the places that these weapons are stored will begin by November, and under the terms of this agreement, those weapons will be removed and destroyed by the middle of next year.

Our aim was also to hold the Assad regime publicly accountable for its horrific use of chemical weapons against its own people on August 21st. And this resolution makes clear that those responsible for this heinous act must be held accountable.

In this resolution, the Council has, importantly, endorsed the Geneva Communique, which calls for a transfer of power to a transitional governing body, paving the way for democratic elections and a government that can be chosen by the people of Syria to represent the people of Syria.

We sought a legally binding resolution, and that is what the Security Council has adopted. For the first time since Syria’s civil war began, the Security Council is spelling out in detail what Syria must do to comply with its legal obligations. Syria cannot select or reject the inspectors. Syria must give those inspectors unfettered access to any and all sites and to any and all people.

We also wanted a resolution that would be enforced. And again, that is what the Security Council has adopted. We are here because actions have consequences. And now, should the regime fail to act, there will be consequences. Progress will be reported back to the Security Council frequently, and in the event of noncompliance, the Council will impose measures under Chapter 7 of the UN Charter.

Just two weeks ago, when the Syrian regime would not even acknowledge the vast supply of chemical weapons and say that they existed, this outcome, frankly, would have been utterly unimaginable. But thanks to the cooperation within the P-5 of the United Nations, and thanks to our friends and partners around the world, many of whom are here in this room, the Security Council has shown that when we put aside politics for the common good, we are still capable of doing big things. Provided this resolution is fully implemented, we will have eliminated one of the largest chemical weapons programs on earth from one of the most volatile places on earth.

The Assad regime carries the burden of meeting the terms of this agreement. And when it comes to those who murder their own citizens, the world’s patience needs to be short. But make no mistake: The rest of the world still carries the burden of doing what we must do to end mass killing by other means. We must work together with the same determination and the same cooperation that has brought us here tonight in order to end the conflict that continues to tear Syria apart even this very day. We must continue to provide desperately needed humanitarian aid. And neither Assad nor anyone else should stand between that aid and the people who need it. Only when we do these things will we have fulfilled our responsibility to the Syrian people and to ourselves. Only then will we have advanced our own interests and our own security and that of our allies in the region. Only then will we have shown that the UN Security Council is meeting its responsibility to enforce international peace and security.

So we are here united tonight in support of our belief that international institutions do matter, that international norms matter. We say with one voice that atrocities carried out with the world’s most heinous weapons will not be tolerated. And when institutions like the Security Council stand up to defend the principles and values that we all share, when we put violent regimes on notice that the world will unite against them, it will lead not only to a safer Syria, but it will lead to a safer world.

Thank you.

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België test beveiligd signaal van Galileo

UNDER SECRETARY OF DEFENSE HALE'S BRIEFING ON PLAN FOR GOVERNMENT SHUTDOWN

FROM:  U.S. DEFENSE DEPARTMENT 
Presenter: Under Secretary of Defense (Comptroller) Robert F. Hale September 27, 2013
News Briefing on the Department Of Defense's Plan for a Possible Government Shutdown


UNDER SECRETARY OF DEFENSE ROBERT F. HALE: Ready to go? All right. So I think you know who I am. I'll say good afternoon. That's probably the high point of this discussion.



So I'm going to start with a few words, then I'll turn to your questions. Let me start by saying the administration firmly believes that a shutdown due to a lapse of appropriation should not occur.



The administration is working with Congress to try to prevent a lapse. Unfortunately, we may not know the outcome of those efforts until next Monday, conceivably even Monday night.



So we have to be prudent and plan for a lapse of appropriations. So what is involved in this planning? As I answer this question and everything I say today, let me say I'm going to focus on the Department of Defense, solely on DOD., but other federal agencies are definitely affected. I just don't -- I know less about them, so I'll focus on DOD.



First it's important to recognize that if DOD's appropriations lapse, we can only conduct limited activity specifically authorized by law. The lapse could lead to civilian furloughs, it will, in fact.



But these furloughs are very different than the sequester furloughs that occurred this summer. The sequester furloughs sought to reduce costs. And we had the authority to design them to reduce costs and to reflect policies like minimizing effects on readiness.



In the case of a lapse of appropriations, law governs, not policy. Specifically the law says that in the event of a lapse of appropriations, DOD can only conduct activities designed to protect safety of life and property and carry out a few other activities.



Administration lawyers interpret this to mean that DOD can support specific military operations that the secretary of defense has approved: Afghanistan, for example, and a number of others.



We can also maintain emergency services, police, fire, emergency medical. We label the activities that can continue as excepted activities, and you will hear me use that word repeatedly in the next couple of minutes.



So what would happen under a lapse of appropriations? First, government employees would be significantly affected. In the event of a lapse, all of our military personnel would be directed to remain on a normal duty status. Their military status means they can't be placed in a non-pay status, so we would direct them to continue in normal-duty status. Civilian workers who support these excepted activities, again Afghanistan emergency activities, they -- they would be directed to continue to work.



But all other civilian workers who do not primarily support excepted activities would be placed in a non-duty, non-pay status on an emergency no-notice basis at the time the lapse occurs. Based on planning in 2011, we would expect roughly half of our civilian personnel would go into this status, essentially a non-pay furlough status.



Pay of government employees could also be seriously affected, especially if the lapse continues for a period of time. During a lapse, DOD cannot pay military personnel and civilian personnel, even if they have been directed to work. Military and those civilians directed to work would be paid retroactively once the lapse of appropriation ends. Civilians on emergency furloughs, and those for the -- primarily doing non-excepted activities would be paid retroactively only if a law is enacted providing the authority to pay them.



Training and travel of military and civilian employees would be disrupted. Unless connected with excepted activities, training and travel would have to be stopped. It would either be stopped before it started, or if it's going on at the time the lapse occurs, then folks associated with -- on TDY associated with non-accepted travel would have to pack up and come home, although they could do that in an orderly fashion.



We would also be required to do some other bad things to our people. Just some examples, we couldn't immediately pay death gratuities to those who die on active duty during the lapse, we would have to close stateside commissaries, promotion boards and other similar important personnel activities would be disrupted, probably would have to be stopped, and a number of other actions.



DOD vendors would also be affected, especially if the lapse continues for a substantial period of time. Vendors working on contracts with funds obligated prior to the lapse in fiscal '13 or earlier funds could continue to work, assuming government personnel are available to provide any needed supervision. And, they could be paid for that work, but during the period of the lapse, we can't sign new contracts or extend old ones unless they're directly in support of excepted activities.



So if I haven't already confused you, let me try to sum up by saying how all these confusing actions affect the DOD mission. We can and will continue to support key military operations. We're allowed to do that by law, but the law would force us to disrupt many of our support activities. We wouldn't be able to do most training, we couldn't enter into most new contracts, routine maintenance would have to stop, we couldn't continue efforts to improve contracting and financial management, including our auto improvement efforts, for example. Even worse, a lapse of appropriations causes civilian furloughs and is one more blow to the morale of our civilian workforce, and that morale is already low and I think would get lower. And that adversely affects productivity and costs the taxpayers money.



Even if a lapse never occurs, the planning itself is disruptive. People are worrying right now about whether their paychecks are going to be delayed, rather than focusing fully on their mission. And while I can't quantify the time being spent to plan, it has or will consume a lot of senior management attention, probably thousands of hours in employee time better spent on supporting national security. For all these reasons, I very much hope that Congress acts to avert a lapse of appropriations, and though it will probably sound contradictory, I hope you will understand when I say that I hope we are all wasting our time planning for this lapse.



With that, I'll stop and I'll be glad to try to answer your questions. I'm going to get George, here.



Q: (inaudible), can you, since everyone lived through the furloughs recently, can you explain a little bit in detail the difference between the civilians who were furloughed under that, and the fact that there are fewer numbers being furloughed now?



If you could maybe give -- maybe an example, it would help so that people would understand what -- how that difference is, and I just have a second, one other, second question. I know contractors is a really hard thing to get your arms around, but is there any way to talk about the number of contractors as in people that could be affected by this?



UNDER SEC. HALE: Well, first on the furloughs. The ones we did in the summer were called administrative furloughs. It's a long notification process, if you remember, that we need to go through. They were designed to save money.



And, therefore, as I mentioned, we can -- we have the authority to design them based on criteria like readiness and cost-savings. These are specified by law. Anybody who is not -- any civilian not primarily working on an excepted activity has to be placed on furloughs.



Can I think of good examples for you? Well, here's one. Most of our working capital fund employees are going to not be furloughed immediately because the working capital funds have a cash balance that's based on funds obligated before the lapse, if you're following me. And so we have the funds and they don't have to be furloughed right away.



Now that would have to be gradually some of them if we run out of cash. Whereas most of our working capital fund employees were furloughed in the summer because we wanted to reduce costs.



As far as the contractors, just briefly, all of the ones working on contracts, as I said, that were obligated with money before the lapse would be able to continue if supervision was available.



I think in the early stages of a lapse, that would be the majority of our contractors because most are going to be working on contracts just almost by definition that were funded before. If the lapse continued, that number would fall. But I don't have specific numbers.



Q: I'm sorry, clarify on the difference between the contractors. If I'm not mistaken, there are about 650,000 that were affected over the summer. Now it's about 400,000. So a difference of a couple hundred thousand seems to be a lot. Am I...



UNDER SEC. HALE: Again, it's -- yes, the numbers are roughly right. I mean, I don't know exactly how many. Probably around half. So it will be close to that.



I mean, again, working capital funds alone are probably 100,000, 150,000 people that we'll keep this time and there are many others. And they're just totally different animals just because one is driven by law, one was driven by policy to save money. One is driven by law -- a specific law about excepted and non-excepted activities.



Q: But they weren't contractors, correct? I mean, these are government...



UNDER SEC. HALE: No. I'm talking government employees now. Contractors, most of them are probably going to be able to continue working if supervision is available because I think most of them would -- although I don't have numbers, most of them are going to be funded by contracts already that were funded with fiscal '13 or earlier money.



Q: For (OFF-MIKE) are looking towards that October 15th paycheck, can you give them a sense of how long this government shutdown might be able to go before their paycheck was definitely delayed? I mean, if Congress reached an agreement on the 4th, would these...



(CROSSTALK)



UNDER SEC. HALE: Yes, I think so. I think the earliest we'd start having trouble would be October 7th. And that's not a hard date. We'll push it as far as we can. But at some point we have to run the payroll.



Frankly, I'm in triage mode right now. I'm trying to help coordinate getting the department ready to shut down if we have to. And so I haven't focused on the problems that will occur if a lapse -- like that one, if the lapse occurs. I'll have to work with the Defense Financing and Accounting Service. We'll put it off as long as we can.



Clearly if the lapse extends to October 15th, there won't be a question. There may be some time prior to that when we'd be faced with either having to take a chance and go ahead and run the payroll and be ready, or delay it. But we have got a while.



Q: Can you talk about what happens to ships at sea, particularly those in the Mediterranean, and whether operations -- kinetic operations could be launched, such as by Special Operations Forces or even a hypothetical strike in Syria?



UNDER SEC. HALE: I mean, it would depend on whether it was a military operation. In the case you just mentioned, I think it surely would be and therefore it would be -- that is if we were -- hypothetically, the president were to authorize some action against Syria, it would be a military operation approved by the secretary and so it would be an excepted activity and, yes, we could go forward with it.



Q: And then ships at sea that are basically...



UNDER SEC. HALE: Well, again, the issue is, are they in direct support of excepted activities? I think many of them will be and therefore they will be excepted. And I might add the great majority of the people on there are military and they're going to remain at work. And so I don't think many of them will be disrupted.



But these are the sort of gray area decisions that our managers and commanders are making right now as they identify excepted and non- excepted. But I think most of the ships at sea would stay there.



If there were some that stayed strictly in training and weren't excepted, they would be able to stand down if they had to in an orderly fashion. And we'll have to make some judgment about what that means. Obviously you can't get the ship back immediately.



Q: Right. But obviously part of the mission at sea often involves planes going on training mission, it requires refueling, purchasing. Can those activities continue?



UNDER SEC. HALE: Again, and I don't want to sound like a stuck record. But it is going to depend on whether the judgment is that this is directly related to an excepted activity, which would be a military operation. I think in many cases, if they're in the Med, that's going to be true.



It would be harder if they're training off Newport -- or Norfolk, for example. That might not be true. Then the question is, are there civilians involved? Or can we go ahead and do it with the military? And I'm -- these are things that get delegated, and our commanders and managers are considering those issues right now.



(UNKNOWN): (OFF-MIKE)



Q: The memo talks about limiting movements from excepted areas. And I'm wondering if it could affect the draw-down from Afghanistan.



UNDER SEC. HALE: Well, Afghanistan is excepted. So let me think. I mean, the -- the PCS [Permanent Change of Station] is -- we can move to an excepted area, so the troops going over to Afghanistan would be OK. From an excepted area if the commander judges that there would be problems created if the move is not carried out.



So that's a judgment General Dunford and his staff will have to make. And I'm not sure where they are on that. Again, I'm sounding like a stuck record, but I don't have all these details. This is what we've passed out to our commanders, managers, and asked them to make these judgments.



Q: (OFF-MIKE)



UNDER SEC. HALE: Well, it's an excepted activity, so -- my lawyer here -- sounds like we should be able to go ahead with that.



Q: So just wondered if you could think back -- I don't know if you were comptroller in '95 and '96.



UNDER SEC. HALE: No.



Q: Probably not.



UNDER SEC. HALE: [inaudible]. I was the Air Force comptroller. (CROSSTALK)



Q: OK. So I know that in one of those shutdowns, Congress had passed an appropriation for DOD. And so -- but I can't remember which one. So just, could compare, you know, the two scenarios...



UNDER SEC. HALE: Yeah.



Q: ... and why this would be...



UNDER SEC. HALE: Well, we shut down in '95, if my memory serves me right, for about a week in DOD. It was longer in the non-defense agencies. So they passed, I guess it was a CR [Continuing Resolution] -- I can't remember -- or whether it was a full appropriations bill earlier for defense.



I mean, there was a lot of similarity. We went through all of these machinations that we are engaged in right now to decide what to do at that time, and then of course executed that plan.



One thing I distinctly remember is that it was a horrendous blow to the civilians. I mean, there was months after that that I was hearing from them. We used a phrase that we have stopped using because it was wrong, essential and non-offensial -- essential back then.



And it's just not right because it's not whether you're essential. It's whether the law says you're doing an excepted activity. There are lots of essential items to keep this military going that don't deal directly with excepted activities.



We've stopped that. Maybe it'll help, but not too much, I mean, especially coming on the heels of the summer furloughs. I am very concerned about the effect this is going to have on our civilian work force.



Q: Just one last -- one other related question is, the shut-down plans in 2011 versus what you're having to, you know, come up with now, are there, you know, differences in operations now that make those shut-down plans not a complete blueprint for what you're doing?



UNDER SEC. HALE: Not many differences. I mean, we made a few exceptions kind of based on recent events. For example, because of the potential flaws to our security system, we exempted the Navy Yard investigation. Obviously, in 2011, that wasn't an issue. But they were pretty minor. I'd say the vast majority of the guidance is the same.



Q: Just to confirm, like troop death benefits would be delayed? Can you provide a little more information about that?



UNDER SEC. HALE: If the -- if the death -- this is ghoulish, but it's the law, not policy. Remember that. If the death occurred after the lapse took place, then the money would be obligated after the lapse took place, and we would have no authority to pay based on that money until the lapse ended. So in that case, they could be delayed.



If the death occurred prior to the lapse, then I -- and assuming we had enough people to process the payment, then I think it wouldn't be delayed.



Q: If the government doesn't shut down, you're still gonna be stuck with a CR come next Tuesday. In the past, you've communicated to Congress provisions you'd like to see in the CR to -- so programs such as ship building wouldn't be hampered. Have you done anything like that? And what...



UNDER SEC. HALE: Yes, we always do through the Office of Management and Budget. I will say there are very few of them in the CR passed by the House and just passed by the Senate. But it's fairly short. This one I believe will go through November 15th.



So we can probably hold our breath for a while, but we would certainly appreciate it, and we would have liked more flexibility for new starts, for example, rate increases, and a variety of other activities that we won't be able to carry out under this CR. But yes, we did ask. We always ask.



Q: Also, if - if you do get funding, you will be facing sequestration again, right? How can you - have you thought about how that will affect?



UNDER SEC. HALE: Yes, potentially. I mean, this CR will be only through, if it - if it's passed as the Senate version, through November 15th, and if it were extended through the whole year in that form, yes, it would generate a sequestration in January, probably around 4 percent, so we could be facing it. Just in general, I think whereas a year ago we said, I think I may have stood at this podium and said we're not going to sequester ourselves, we really thought this would be resolved, I think this time we will start operating at a somewhat lower level than - than certainly than the President's request. The CR itself cuts the DOD budget, or would result in a cut of around $30 billion. The sequester would take out another $20 [billion] or so, so we will start at a level below the President's budget in order to conserve resources until we get a better sense of where we're actually headed.



Q: (inaudible).



Q: Just one quick clarification, so that October 1st, all paychecks will go out October 1st, right?



UNDER SEC. HALE: Correct. There's a payday today for the civilians that of course is not affected, and one on October 1st to the military, and it's not affected because it's all for time before any lapse would occur, and then the reserves are trickier because they are paid at various times, and we're already struggling with some of that, but I mean, I'm hoping we can minimize or avoid any disruptions there too.



Q: And then I (inaudible) clarification of, so one of the things that - that's listed as excepted, and I guess this is under the - this is under the law, (inaudible), but is activities necessary to continue recruiting? So are we talking like air shows, and that kind of ...



(CROSSTALK)



UNDER SEC. HALE: No, I mean, we'll be talking about probably recruiting offices, the military entrance examination centers, the things more directly related to it.



Q: And I mean I know this is a - this is a - putting a linear question on like - on a very three-dimensional problem here, but - but I - I mean, why is it that if there is money that would be available if something were to happen and - and there was a need to send a force to, we'll just say Syria since it's, you know, topic of the day, but to Syria, but there's not money that's available somewhere to pay people. Is there a good reason?



UNDER SEC. HALE: It's - it's the - yeah, it's the difference between obligations and our ability to disperse. The law says that in the lapse of appropriations, we can obligate money, which means we can enter into a contract and legally commit the government, we can obligate money for items related to safety of life, preservation of property, that's with all military operations, but we can't disperse anything, actually send a check until we get an appropriation, so we can go ahead with the operation, we'd be committing the government, but they're not going to get paid, or the - the personnel at least aren't going to get paid until we actually get an appropriation. Does that make sense?



Q: Yeah, absolutely. Thank you.



Q: Are there any specific upcoming multinational training exercises that would have to be canceled if there's a shutdown?



UNDER SEC. HALE: I don't know. My guess is, I don't know. As I say, you know, I assume nobody knows of it either. If we get into this, you know, we're going to have to go one level of indenture down. I mean, somebody knows, PACOM [U.S. Pacific Command] or EUCOM [U.S. European Command] they certainly would know, but I'm not aware of any.



(CROSSTALK)



Q: (inaudible) Roughly 400,000 DOD employees?



UNDER SEC. HALE: Based on - Tony, we don't have the numbers yet. We're still gathering them for this year, but it was around 50 percent of our civilians who were excepted two and a half years ago. I would expect it to be in that vicinity again. That would be around 400,000 maybe a little less. Our foreign national employees who are part of that 800,000 are excepted if they are paid by foreign governments, so we take them off the top, it would probably be a little less than 400,000 when we're done.



Q: They should be around 800,000 of which 400,000 potentially could be, and most of those are outside of the Washington, D.C. area, is that?



UNDER SEC. HALE: Eighty-six percent of our overall civilians are outside of Washington, so I think it's fair to say the majority of them will be.



Q: What is the thinking in terms of when RIF [Reduction in Force] notices or RIF packages would have to be pulled together, since you're not planning for furloughs in 2014?



UNDER SEC. HALE: Well, I mean, you will - we have planned some of them based on accommodating a $487 billion 10-year cut that we took in prior budgets, that - that over the next few months, I think some of those would be announced. The ones associated with these cuts takes awhile to formulate these, and - and so it will probably be a period of time and I'm not sure exactly when before we'll have those out. But you're going to see some reductions in force actions over coming months, and some involuntary separations in the military as we begin this drawdown.



Q: (OFF-MIKE) potentially it was like 6,200 a couple - back in early August you were thinking of -- you and the department, any rough number of potential RIFs?



UNDER SEC. HALE: No, I don't want to give you a number, because I don't think we're far enough along to be specific. And that number is headline stuff. So I'd prefer not to.



Q: How will Arlington burials be affected?



UNDER SEC. HALE: Yeah, we will exempt -- Arlington is actually paid to the Army. And I believe it will stay open, but I'd kind of like to check that.



We have decided -- based on mental health and other reasons -- to except funerals and dignified transfers. And so the people supporting those would be excepted and they will continue.



Q: And then just a follow up on the civilians expected to work but no guarantee of pay, is that unless something is passed in Congress?



UNDER SEC. HALE: It comes in two flavors. The ones who are associated with excepted activities, they will be directed to work. They will be paid retroactively -- as soon as we get an appropriation. And that will be automatic. The ones who are put on furlough, that would require an act of Congress in order to pay them retroactively.



Q: Are there any very significant differences between this guidance and the guidance from April 2011 or any of the ...



UNDER SEC. HALE: No, it's pretty modest -- I gave you the one example of the Navy Yard investigation, and there may be a couple others, but they are very modest. Unfortunately, we're getting good at this.



Q: In addition to having to worry about FY [fiscal year] '14, you have to develop an FY '15 budget concurrently. Can you update us on how that's going, and is all the time and attention you have to deal with for planning for a shutdown taking away from that?



UNDER SEC. HALE: I mean, absolutely. It's taking away from everything we do, at least anything of the people who are related to budget. Yes, it's slowing it down.



But we have to press forward, and it's a particularly demanding task this year, because we really feel we have to plan for a range of outcomes. We just don't know where we're gonna end up. A decision the president will ultimately make in December as to the size of the '15 budget and the plan beyond. So we're really planning for a pretty wide range of spending.



Q: Have the services given you everything they need for that?



UNDER SEC. HALE: They are in the process of doing that. They have submitted briefings on what we call our program objectives memoranda, and are submitting detail data right now.



Q: You had mentioned some ability to do -- to sign new contracts in the event of a government shutdown. The guidance mentions that it would be allowed when delaying contracting would endanger national security, but I wonder for some of your bigger weapons programs and vehicles and things how would you legally be able to decide what delays would endanger?



UNDER SEC. HALE: I mean, we can (inaudible) sign new contracts or extend old ones if they are in direct support of excepted activities. I think it would probably be a stretch for a major acquisition to qualify there, although it's extremely important -- that's another good difference between excepted and non-excepted and essential and non-essential. I mean, we need these weapons, but they'd probably be hard to relate them directly to a current military operation.



Now, the good news is, this coming at the beginning of the year, you don't tend to have a lot of those decisions facing you early on. So -- and those that you have, you could delay. I think if a lapse occurs, I definitely hope it doesn't, but the severity of the effects would grow quickly as it - if it turns out to be long. If it's short, it will be damaging, but less so. If it's long, it will be increasingly so, because it will catch more issues like that.



Q: Can you talk some more about the extent to which you would expect military personnel to be performing the duties of furloughed civilians as opposed to their normal day jobs? And I guess the same question for any contractors who might be able to stick around because they're paid the prior years.



Well, on the military side, I mean, they would have their normal jobs and they would continue that. I think there could be circumstances, for example, if there was an important contract funded with money before the lapse, and supervision was needed and the civilian was furloughed that, maybe the person had the capability to do that, I could see them doing that. But I think for the most part they will be doing their same jobs.



Same with the contractors, in general, they're going to be doing the jobs they were assigned. They can't -- the contractors would never be allowed -- furlough -- shutdown or not, to do inherently governmental work. There could be some circumstances, an admin assistant who was a contractor answering phones because a -- a person – a civilian was furloughed. It could be some of that, but for the most part, they're gonna go ahead and do the jobs they were assigned to.



(UNKNOWN): Thank you very much. Mr. Hale, thanks.

SECRETARY OF STATE KERRY'S REMARKS AT GLOBAL HEALTH EVENT WITH PARTNER COUNTRIES

FROM:  U.S. STATE DEPARTMENT 
Remarks at a Global Health Event with Partner Countries (PEPFAR)
Remarks
John Kerry
Secretary of State
Waldorf Hotel
New York City
September 25, 2013

Well, good afternoon, everybody, and thank you very, very much for joining us here. It’s my great privilege to be joined by His Excellency, the President of Namibia, President Pohamba; His Excellency, the President of Rwanda, Paul Kagame; and His Excellency, the Ambassador to the United States, Ebrahim Rasool from South Africa. And we’re very honored to have each of them here to take part. As all of you, we want to have a good discussion. We’re going to open it up with a few opening statements while the press is here. And then when the press leaves, we’ll have a chance to just talk and have a great dialogue about the future here.

We’re really at the cusp of a very exciting new frontier with respect to the President’s Emergency Plan for AIDS Relief, known to everybody as PEPFAR. And I’m very proud to be joined by our global partners as well as a group of stakeholders here as we hopefully embrace and implement all of the tools at our disposal to be able to achieve an AIDS-free generation and to improve global healthcare by strengthening our commitments to PEPFAR and the Global Fund to Fight AIDS, Tuberculosis, and Malaria.

This has been an extraordinary journey, and I think everybody at this table understands that. A decade ago, PEPFAR created the world’s largest and the most successful foreign assistance program ever. And now, a disease that at one time seemed to be unstoppable is actually in retreat.

I have been gratified to be part of this fight since the beginning, really, and particularly will say to you that I’ve never been more optimistic than we are today, and I think you may share that. I remember the days in Congress when the words “AIDS” was very rarely spoken. And often if it was spoken, it was spoken pejoratively. And I can remember the early days working with Senator Bill Frist or Barbara Lee on the earliest efforts to engage the United States Government on a major global commitment. And it is really heartening to know that now, 10 years after PEPFAR was launched, we are actually able to see and reach out and hopefully touch the prospect of an AIDS-free generation.

So our commitment to this has not only been strengthened by the progress that we’ve made and the lives that we’ve saved, but science has shown the way and has provided us with the tools that we need in order to be able to continue our collective pursuit of what has always been an ambitious goal, remains ambitious but not ambitious without the capacity to realize the ambition, which is particularly exciting.

Last year – I’m sure many of you were there – I was privileged to attend with you the first International AIDS Society conference to be held on American soil in more than two decades. And we all know why it couldn’t be for so long. We finally got that changed. And I’m especially proud to announce today that the United States will host the Global Fund’s Fourth Replenishment in December.

Since its inception, the Global Fund has been a vital partner in supporting country-owned – and this is very important – country-owned responses to address HIV/AIDS, tuberculosis, and malaria. And the United States is proud to be the Global Fund’s largest donor, and we’re challenging other donors to step up their commitments at this critical moment and make the replenishment cycle a success. We’re already encouraged by the increased pledges from the United Kingdom, Denmark, Norway, and Sweden, as well as those from Germany and France earlier this year, who agreed to extend their already current high level of commitment.

So we’re now entering the second decade of PEPFAR. And as you’re aware, the program has taken steps over the past few years to move from an emergency program to a sustainable initiative. U.S. programs, I think it’s fair to say, are still absolutely critical. But now, wherever possible, those programs are going to support countries’ own initiatives against this epidemic, and that’s what’s really exciting about it. That’s, frankly, exactly what our foreign assistance is supposed to do, is to help other countries to be able to take the reins and empower them to be able to confront challenges like HIV and AIDS themselves.

South Africa, Rwanda, Namibia are all on the front lines of this effort. And in the face of one of the greatest moral challenges of our time, each of those countries have responded in extraordinary ways in order to care for your own people. You’re not just investing in your own health capacity, but you are helping to lead the charge to define a new model for U.S. assistance. And we thank you for that. It’s one that empowers and emphasizes co-investment, collaboration, and true partnership. And none of these things can work if it isn’t transformed into sustainability, if it doesn’t become, really, a country’s own initiative.

That’s what country health partnerships are all about. They are about shared responsibility, shared accountability, budget transparency, and a commitment to investing strategically based on what we’ve learned from improved data collection and analysis. These partnerships are country specific to ensure that we are responsive to local needs. And they’ll also benefit from shared decision-making on how PEPFAR resources are allocated as part of a national response.

So make no mistake, please. The United States will continue to be responsible for the stewardship of its funds, and congressional mandates will remain in effect. But we believe that by sharing more decisions with countries, we can advance the principles of country ownership that President Obama and I believe in so strongly. And that will allow us to continue to make progress on prevention, on treatment, and awareness.

Fighting HIV/AIDS isn’t just a first-tier priority of our foreign policy and public health initiatives. And I’m blessed, as I look around the table speaking— we have a group of unbelievably qualified, incredibly experienced, and amazingly capable people at this table. You are the people, all of you, who made this happen over these last years. But beyond being sort of that foreign policy initiative, it’s also a test of our values. And we have to reaffirm our moral obligation, and we have to acknowledge that our shared humanity mandates that we continue to challenge ourselves until we defeat this devastating epidemic.

So with that, I want to turn to our country partners here today and ask each of them if they would offer their perspective on exactly how we take the next step forward together. So let me first, if I may, introduce President Pohamba of Namibia.

IMPROVING EMPLOYMENT FOR THE PREVIOUSLY INCARCERATED

FROM:  U.S. LABOR DEPARTMENT 

US Labor Department awards nearly $24 million in Pay for Success grants

New York and Massachusetts awarded grants to improve employment outcomes for formerly incarcerated individuals

WASHINGTON — The U.S. Department of Labor today announced nearly $24 million in Workforce Innovation Fund grants to pilot the Pay for Success program, a new model of financing social service programs to help federal, state and local governments ensure that public funds only go to programs that achieve positive, measurable outcomes. Under this model, independent investors provide the financial capital to cover the operating costs for the programs, and the Department of Labor disburses funds when and if those programs demonstrate that they have achieved the targeted outcomes.

Two grants were awarded: one to the New York Department of Labor in the amount of $12,000,000 and the other to the Massachusetts Executive Office of Labor and Workforce Development in the amount of $11,670,000. These grants will support programming that aims to increase employment and reduce recidivism among formerly incarcerated individuals.

"The Pay for Success model is a promising strategy for expanding effective programs while ensuring maximum return on taxpayer dollars," said Secretary of Labor Thomas E. Perez. "At a time when all levels of government are experiencing cutbacks, Pay for Success offers a new approach to strategically leverage resources to provide essential services for vulnerable populations through programs with measurable success rates."

The grants announced today represent amounts of committed funds, which the department will release in installments based on whether the grant outcomes were met. Both grantees are expected to employ rigorous evaluation methods in gauging the results of their respective programs, and the findings will be reviewed by independent validators at the end of grant performance period.

The robust evaluation component incorporated in Pay for Success projects will also help to: 1) the expand the body of knowledge about the intervention strategies being tested, 2) demonstrate the feasibility and viability of this funding model and 3) use taxpayer dollars wisely by shifting the investment risk to private investors and releasing funding based on results.

The original solicitation for Pay for Success grant applications announced that $20 million would be awarded. Because of the quality of applications received, the department elected to fully fund the top two grant applicants’ projects using funds from fiscal years 2012 and 2013.

U.S. Department of Education Awards $89.8 Million in Magnet School Assistance Program Grants

U.S. Department of Education Awards $89.8 Million in Magnet School Assistance Program Grants

REGULATORS ISSUE GUIDANCE ON ELDER FINANCIAL ABUSE

FROM:  U.S. SECURITIES AND EXCHANGE COMMISSION 
Federal Regulators Issue Guidance on Reporting Financial Abuse of Older Adults
JOINT RELEASE
Board of Governors of the Federal Reserve System 
Consumer Financial Protection Bureau 
Federal Deposit Insurance Corporation 
Federal Trade Commission 
National Credit Union Administration 
Office of Comptroller of the Currency 
Securities and Exchange Commission 

Seven federal regulatory agencies today issued guidance to clarify that the privacy provisions of the Gramm-Leach-Bliley Act generally permit financial institutions to report suspected elder financial abuse to appropriate authorities.

The Gramm-Leach-Bliley Act generally requires that a financial institution notify consumers and give them an opportunity to opt out before providing nonpublic personal information to a third party. Today’s guidance clarifies that it is generally acceptable under the law for financial institutions to report suspected elder financial abuse to appropriate local, state or federal agencies.

Older adults can be attractive targets for financial exploitation and may be taken advantage of by scam artists, financial advisors, family members, caregivers, or home repair contractors. Recent studies suggest that financial exploitation is the most common form of elder abuse and that only a small fraction of incidents is reported. Older adults often are targeted because they have retirement savings, accumulated home equity, or other assets. They also are more likely to experience cognitive decline, which can impair their capacity to recognize financial exploitation and scams.

Employees of financial institutions may be able to spot irregular transactions, account activity, or behavior that signals financial abuse. They can play a key role in preventing and detecting elder financial exploitation by reporting suspicious activities to the proper authorities.

The interagency guidance is being issued by the Board of Governors of the Federal Reserve System, Consumer Financial Protection Bureau, Federal Deposit Insurance Corporation, Federal Trade Commission, National Credit Union Administration, Office of the Comptroller of the Currency, and the Securities and Exchange Commission. The Commodity Futures Trading Commission is issuing the document as staff guidance.

Quitting, gaining, and reducing risk

Quitting, gaining, and reducing risk

BERNIE MADOFF'S ACCOUNTANT CHARGED BY SEC WITH CREATION OF FALSE BOOKS AND RECORDS

FROM:  U.S. SECURITIES AND EXCHANGE COMMISSION 

The Securities and Exchange Commission today charged the longtime accountant for many of Bernard Madoff’s oldest and wealthiest clients for his role in the creation of false books and records used in the massive Ponzi scheme.

The SEC alleges that Paul Konigsberg’s assistance resulted in the formation of inaccurate trade confirmations each month as well as the development of phony data and records documenting the fabricated trades that were, in turn, falsely reflected in the ledgers and related books and records at Bernard L. Madoff Investment Securities LLC (BMIS).

“Konigsberg played a vital role in Madoff’s deception of his oldest and wealthiest clients over many years,” said Andrew M. Calamari, Director of the SEC’s New York Regional Office.  “Konigsberg’s acquiescence, cooperation, and collaboration were essential to the Madoff fraud.”

In a parallel action, the U.S. Attorney’s Office for the Southern District of New York today announced criminal charges against Konigsberg.

According to the SEC’s complaint filed in U.S. District Court for the Southern District of New York, Konigsberg aided and abetted the falsification of books and records at BMIS from at least the mid-1990s to late 2008.  Konigsberg provided tax or accounting services for more than 200 BMIS client accounts, including five of Madoff’s wealthiest and oldest clients who invested more than a billion dollars combined in BMIS.  Konigsberg received fees directly from BMIS clients for the accounting services that he provided them, and BMIS and Madoff paid him a monthly fee of $15,000 or $20,000 as a “retainer” for providing accounting services to a wealthy and longtime Madoff client and his adult children.

The SEC alleges that Konigsberg coordinated with BMIS staff to:

Decide upon desired investment or tax gains and losses to be manufactured and reflected on BMIS account statements and in BMIS computer systems to ensure his clients enjoyed favorable tax treatment for their purported investment activity.
Confer about backdated trades and fictitious account activity entered into the computer systems to create the desired trading results.
Return or destroy his clients’ true BMIS account statements and design alternative fictitious account activity to be entered into the firm’s books and records and reflected on new phony account statements.
The SEC’s complaint alleges that Konigsberg, who lives in Greenwich, Conn., aided and abetted the BMIS violations of Section 17(a) of the Securities Exchange Act and Rule 17a-3, and Section 204 of the Investment Advisers Act and Rule 204-2.  The SEC’s complaint seeks disgorgement of ill-gotten gains, financial penalties, and permanent injunctions against Konigsberg.

The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York and the Federal Bureau of Investigation.  The SEC’s investigation is continuing.

U.S. Department of Defense Armed with Science Update: IT MILESTONE

U.S. Department of Defense Armed with Science Update

EDUCATION AWARDS $14 MILLION IN GRANTS TO 31 NATIVE AMERICAN AND ALASKA NATIVE ENTITIES

FROM:  U.S. DEPARTMENT OF EDUCATION 
U.S. Department of Education Awards $14 Million in Grants to 31 Native American and Alaska Native Entities
SEPTEMBER 25, 2013

The U.S. Department of Education today announced the award of about $14 million in grants to 31 Indian tribes, tribal organizations, and Alaska Native entities to help them improve career and technical education programs.

Under the 2013 Native American Career and Technical Education Program (NACTEP) competition, the Department encouraged applicants to propose projects that included promoting science, technology, engineering and mathematics (STEM), and the use of technology within career and technical education programs. Career and technical education in the STEM fields is important to providing students with education that can lead to employment in high growth, in-demand industry sectors.

"In today's global and knowledge-based economy, it's critical that we prepare all students for jobs that lead to a success career," said U.S. Secretary of Education Arne Duncan. "These grants will help underrepresented groups attain the necessary resources to earn an industry certification and postsecondary certificate or degree, while also strengthening our country’s global competitiveness."

The NACTEP requires the Secretary to ensure that activities will improve career and technical education for Native American and Alaska Native students. Additionally, NACTEP grants are aligned with other programs under the Carl D. Perkins Career & Technical Education Act of 2006 that require recipients to provide coherent and rigorous content aligned with challenging academic standards. NACTEP projects also include preparing students for the high-skill, high-wage, or high-demand occupations in emerging or established professions.

Below is a list of the 2013 NACTEP Grantees:

Cook Inlet Tribal Council, Inc. (Alaska) $417,543

Council of Athabascan Tribal Governments (Alaska) $470,022

Pascua Yaqui Tribe (Ariz.) $411,460

Hoopa Valley Tribe (Calif.) $470,130

Coeur d’ Alene Tribe (Idaho) $469,362

Keweenaw Bay Ojibwa Community College (Mich.) $341,938

Little Traverse Bay Bands of Odawa Indians (Mich.) $452,804

Mississippi Band of Choctaw Indians (Miss.) $470,689

Aaniiih Nakota College (Mont.) $467,256

Blackfeet Community College (Mont.) $386,966

Blackfeet Tribal Employment Rights Office (Mont.) $464,890

Fort Peck Community College (Mont.) $469,785

Salish Kootenai College (Mont.) $471,559

Stone Child College (Mont.) $473,556

Winnebago Tribe of Nebraska (Neb.) $469,345

Cankdeska Cikana Community College (N.D.) $450,564

Fort Berthold Community College (N.D.) $452,874

Sitting Bull College (N.D.) $415,660

Turtle Mountain Community College (N.D.) $471,466

Alamo Navajo School Board, Inc. (N.M.) $471,937

Coyote Canyon Rehabilitation Center, Inc. (N.M.) $473,912

Cherokee Nation (Okla.) $470,425

Choctaw Nation of Oklahoma (Okla.) $468,923

Shawnee Tribe (Okla.) $434,613

Pawnee Nation College (Okla.) $470,956

Oglala Lakota College (S.D.) $467,835

Sinte Gleska University (S.D.) $466,900

Muckleshoot Indian Tribe (Wash.) $437,674

Northwest Indian College (Wash.) $416,097

The Tulalip Tribes of Washington (Wash.) $451,113

College of Menominee Nation (Wis.) $472,994

OFFICIALS APPEAR BEFORE SENATE COMMITTEE TO DISCUSS INTELLIGENCE PROGRAMS

FROM:  U.S. DEFENSE DEPARTMENT 
Officials Discuss Intelligence Programs at Senate Hearing
By Cheryl Pellerin
American Forces Press Service

WASHINGTON, Sept. 27, 2013 - At a hearing yesterday before the Senate Select Committee on Intelligence, Army Gen. Keith B. Alexander, commander of U.S. Cyber Command and director of the National Security Agency, and Director of National Intelligence James R. Clapper Jr. discussed a NSA-managed classified intelligence program, one of two made public by a security leak in June.

Joining Alexander and Clapper was Deputy Attorney General James Cole. All were called to testify about both programs leaked to the press by former NSA systems administrator Edward Snowden -- Section 215 of the Patriot Act, also known as NSA's 215 business records program, and Section 702 of the Foreign Intelligence Surveillance Act, or FISA.

In the months since the leaks, media reports have said the programs involve secret surveillance by NSA of phone calls and online activities of U.S. citizens, and revealed unauthorized disclosures of information by NSA, generating distrust of the agency and calls for an end to the programs.

Section 702 of FISA and Section 215 of the Patriot Act both were authorized by the Foreign Intelligence Surveillance Act, first approved by Congress in 1978.

Section 702 authorizes access, under court oversight, to records and other items belonging to foreign targets located outside the United States. Section 215 broadens FISA to allow the FBI director or other high-ranking officials there to apply for orders to examine telephone metadata to help with terrorism investigations.

In 2012, these programs resulted in the examination of fewer than 300 selectors, or phone numbers, in the NSA database, Alexander said during a congressional hearing in July.

In his remarks, Cole described the 215 program, explaining that it involves collecting only metadata from telephone calls.

"What is collected as metadata is quite limited. ... It is the number a telephone calls ... It doesn't include the name of the person called," Cole said. "It doesn't include the location of the person called. It doesn't include any content of that communication. It doesn't include financial information ... It is just the number that was called, the date and the length of the call."

"If you want any additional information beyond that, you would have to go and get other legal processes to find that information and acquire it," he added.

Such metadata can only be looked at when there is a reasonable, articulable suspicion for a specific phone number to be queried in the database, Cole said.

"Otherwise," he said, "we do not and cannot just roam through this database looking for whatever connections we may think are interesting or in any way look at it beyond the restrictions in the court order."

Only a small number of analysts can make such a determination, and that determination must be documented so it can be reviewed by a supervisor and later reviewed for compliance purposes, Cole added. The program is conducted according to authorization by the FISA Court, which must reapprove the program every 90 days.

"Since the court originally authorized this program in 2006, it has been reapproved on 34 separate occasions by 14 individual Article Three judges of the FISA Court," Cole said. "Each reapproval indicates the court's conclusion that the collection was permissible under Section 215 and satisfied all constitutional requirements."

Article Three of the U.S. Constitution establishes the judicial branch of the federal government.

Oversight of the 215 program involves all three branches of government, including the FISA Court and the Intelligence and Judiciary Committees of both houses of Congress, Cole said. Every 90 days, the Department of Justice reviews a sample of NSA's queries to determine whether the reasonable articulable requirement has been met.

DOJ lawyers meet every 90 days with NSA operators and with the NSA inspector general to discuss the program's operation and any compliance issues that may arise, Cole explained.

With respect to Congress, "we have reported any significant compliance problems, such as those uncovered in 2009, to the Intelligence and Judiciary Committees of both houses," he said.

"Those documents have since been declassified and released by the DNI to give the public a better understanding of how the government and the FISA court respond to compliance problems once they're identified," Cole said.

In his testimony, Alexander told the panel that NSA's implementation of Section 215 of the Patriot Act focuses on defending the homeland by linking foreign and domestic threats.

Section 702 of FISA focuses on acquiring foreign intelligence, he said, including critical information concerning international terrorist organizations, by targeting non-U.S. persons who are reasonably believed to be outside the United States.

NSA also operates under other sections of the FISA statute in accordance with the law's provisions, Alexander said.

"To target a U.S. person anywhere in the world, under the FISA statute we are required to obtain a court order based on a probable cause showing that the prospective target of the surveillance is a foreign power or agent of a foreign power," he explained.

"As I have said before, these authorities and capabilities are powerful," Alexander said. "We take our responsibility seriously."

NSA stood up a directorate of compliance in 2009 and regularly trains the entire workforce in privacy protections and the proper use of capabilities, he said.

"We do make mistakes," Alexander noted.

"Compliance incidents, with very rare exceptions, are unintentional and reflect the sorts of errors that occur in any complex system of technical activity," he said.

The press has claimed evidence of thousands of privacy violations but that is false and misleading, Alexander said.

"According to NSA's independent inspector general, there have been only 12 substantiated cases of willful violation over 10 years. Essentially one per year," he said. "Several of these cases were referred to the Department of Justice for potential prosecution, and appropriate disciplinary action in other cases. We hold ourselves accountable every day."

Of 2,776 violations noted in the press, he said, about 75 percent were not violations of court-approved procedures but rather were NSA's detection of valid foreign targets that traveled to the United States. The targets are called roamers and failure to stop collecting on them as soon as they enter the United States from a foreign country is considered a violation that must be reported.

"NSA has a privacy compliance program that any leader of a large, complex organization would be proud of," Alexander said. "We welcome an ongoing discussion about how the public can, going forward, have increased information about NSA's compliance program and its compliance posture, much the same way all three branches of the government have today."

NSA's programs have contributed to understanding and disrupting 54 terrorism-related events, Alexander told the panel, with 25 in Europe, 11 in Asia, five in Africa, and 13 in the United States.

"This was no accident. This was not coincidence. These are the direct results of a dedicated workforce, appropriate policy, and well-scoped authorities created in the wake of 9/11, to make sure 9/11 never happens again," Alexander said.

In the week ending 23 Sept., he said, there were 972 terrorism-related deaths in Kenya, Pakistan, Afghanistan, Syria, Yemen and Iraq. Another 1,030 people were injured in the same countries.

"The programs I've been talking about -- we need these programs to protect this nation, to ensure that we don't have those same statistics here," Alexander said.

With respect to reforms, he said, on Aug. 9 President Barack Obama laid out specific steps to increase the confidence of the American people in the NSA foreign intelligence collection programs.

"We are always looking for ways to better protect privacy and security," Alexander said. "We have improved over time our ability to reconcile our technology with our operations and with the rules and authorities. We will continue to do so as we go forward and strive to improve how we protect the American people, their privacy and their security."

In his remarks to the panel, Clapper said that over past 3 months he's declassified and publicly released a series of documents related to Section 215 Section 702.

"We did that to facilitate informed public debate about the important intelligence collection programs," he said. "We felt in the light of the unauthorized disclosures, the public interest in these documents far outweigh the potential additional damage to national security. These documents [allow them to] see the seriousness, thoroughness and rigor with which the FISA Court exercises its responsibilities."

Even in these documents, Clapper said, officials had to redact some information to protect sensitive sources and methods such as particular targets of surveillance.

"We'll continue to declassify more documents. It's what the American people want," he said. "It's what the president has asked us to do. And I personally believe it's the only way we can reassure our citizens that the intelligence community is using its tools and authorities appropriately."

But, Clapper said, "we also have to remain mindful of potentially negative long-term impact of over-correcting to the authorizations granted to the intelligence community."

Clapper added, "As Americans we face an unending array of threats to our way of life -- more than I've seen in my 50 years in intelligence. We need to sustain our ability to detect these threats. We welcome a balanced discussion about civil liberties but it's not an either-or situation. We need to continue to protect both."

PRESIDENT OBAMA'S WEEKLY ADDRESS FOR SEPTER 28, 2013

FROM:  THE WHITE HOUSE 
SEPTEMBER 28, 2013
Weekly Address: Averting a Government Shutdown and Expanding Access to Affordable Healthcare

WASHINGTON, DC— In this week’s address, President Obama said that on October 1st, a big part of the Affordable Care Act will go live and give uninsured Americans the same chance to buy quality, affordable health care as everyone else.  It is also the day when some Republicans in Congress might shut down the government just because they don’t like the law. The President urged Congress to both pass a budget by Monday and raise the nation’s debt ceiling so that we can keep growing the economy. He also said that those without health insurance and those who buy it on the individual market should visit HealthCare.gov to find out how to get covered on Tuesday.

The audio of the address and video of the address will be available online at www.whitehouse.gov at 6:00 a.m. ET, September 28, 2013.

Remarks of President Barack Obama
Weekly Address
The White House
September 28, 2013

Hi, everybody.  This Tuesday is an important day for families, businesses, and our economy.

It’s the day a big part of the Affordable Care Act kicks in, and tens of millions of Americans will finally have the same chance to buy quality, affordable health care as everyone else.

It’s also the day that a group of far-right Republicans in Congress might choose to shut down the government and potentially damage the economy just because they don’t like this law.

I’ll get to that in a second.  But first – here’s what the Affordable Care Act means for you.

If you’re one of the vast majority of Americans who already have health care, you already have new benefits you didn’t before, like free mammograms and contraceptive care with no copay, and discounts on prescription medicine for seniors.  You’ve already got new protections in place too, like no more lifetime limits on your care, no more discriminating against children with preexisting conditions like asthma, or being able to stay on your parents’ plan until you turn 26.

That’s all in place and available to Americans with health insurance right now.

If you don’t have health insurance, or if you buy it on the individual market, then starting this Tuesday, October 1st, you can visit HealthCare.gov to find what’s called the health insurance marketplace in your state.

This is a website where you can compare insurance plans, side-by-side, the same way you’d shop for a TV or a plane ticket.  You’ll see new choices and new competition.  Many of you will see cheaper prices, and many of you will be eligible for tax credits that bring down your costs even more.  Nearly 6 in 10 uninsured Americans will be able to get coverage for $100 or less.

If you’re one of the up to half of Americans with a preexisting condition, these new plans mean your insurer can no longer charge you more than anyone else.  They can’t charge women more than men for the same coverage.  And they take effect January 1st.

So get covered at HealthCare.gov.  And spread the word.  These marketplaces will be open for business on Tuesday, no matter what.  The Affordable Care Act is one of the most important things we’ve done as a country in decades to strengthen economic security for the middle class and all who strive to join the middle class.  And it is going to work.

That’s also one of the reasons it’s so disturbing that Republicans in Congress are threatening to shut down the government – or worse – if I don’t agree to gut this law.

Congress has two responsibilities right now: pass a budget on time, and pay our bills on time.

If Congress doesn’t pass a budget by Monday – the end of the fiscal year – the government shuts down, along with many vital services the American people depend on.  On Friday, the Senate passed a bill to keep the government open.  But Republicans in the House have been more concerned with appeasing an extreme faction of their party than working to pass a budget that creates new jobs or strengthens the middle class.  And in the next couple days, these Republicans will have to decide whether to join the Senate and keep the government open, or create a crisis that will hurt people for the sole purpose of advancing their ideological agenda.

Past government shutdowns have disrupted the economy.  This shutdown would, too.  At a moment when our economy has steadily gained traction, and our deficits have been falling faster than at any time in 60 years, a shutdown would be a purely self-inflicted wound.  And that’s why many Republican Senators and Republican governors have urged Republicans in the House of Representatives to knock it off, pass a budget, and move on.

This brings me to the second responsibility Congress has.  Once they vote to keep the government open, they must also vote within the next couple weeks to allow the Treasury to pay the bills for the money that Congress has already spent.  Failure to meet this responsibility would be far more dangerous than a government shutdown – it would be an economic shutdown, with impacts not just here, but around the world.

Unfortunately some Republicans have suggested that unless I agree to an even longer list of demands – not just gutting the health care law, but things like cutting taxes for millionaires or rolling back rules on big banks and polluters– they’ll push the button, throwing America into default for the first time in history and risk throwing us back into recession.

I will work with anyone who wants to have a serious conservation about our economic future.  But I will not negotiate over Congress’ responsibility to pay the bills it has already racked up.  I don’t know how to be more clear about this: no one gets to threaten the full faith and credit of the United States of America just to extract ideological concessions.  No one gets to hurt our economy and millions of innocent people just because there are a couple laws you don’t like.  It hasn’t been done in the past, and we’re not going to start doing it now.

The American people have worked too hard to recover from crisis to see extremists in their Congress cause another one. And every day this goes on is another day that we can’t continue the work of rebuilding the great American middle class.  Congress needs to pass a budget in time, pay its bills on time, and refocus on the everyday concerns of the people who sent them there.

That’s what I’m focused on.  That’s what I’ll keep fighting for.

Thank you.

PATIENT-CENTERED CARE FOR VETERANS

FROM:  U.S. DEPARTMENT OF VETERANS AFFAIRS 
VA Announces Award of Patient-Centered Community Care Contracts
September 19, 2013

Contracts Provide Expanded Access to Community-based Care
WASHINGTON -- The Department of Veterans Affairs announced today that Veterans will have greater access to quality health care through a new initiative:  Patient-Centered Community Care (PCCC).  

“PCCC is an innovative solution that helps VA medical centers continue to provide quality care efficiently,” said Secretary of Veterans Affairs Eric K. Shinseki. “This will be a valuable option for VA medical centers to use to expand our Veterans’ access to care.”

Under PCCC, VA medical centers will have the ability to purchase non-VA medical care for Veterans through contracted medical providers when they cannot readily provide the needed care due to geographic inaccessibility or limited capacity.  Eligible Veterans will have access to inpatient specialty care, outpatient specialty care, mental health care, limited emergency care, and limited newborn care for enrolled female Veterans following the birth of a child.

“PCCC provides a regional contracting vehicle for VA to work with local community providers to give Veterans access to high quality care,” said Dr. Robert Petzel, VA’s Under Secretary for Health.  “It will also help VA in our continued efforts to ensure timely and accessible services are provided to Veterans for non-VA medical care.”

In total, VA has awarded two contracts under PCCC, one to Health Net Federal Services LLC and another to TriWest Healthcare Alliance Corp.  These companies will set up networks in six regions covering the entire country.  VA expects to have these regional contract networks available to its medical centers by the spring of 2014.  The awarded contracts, estimated at $9.4 billion, include one base year and four option years.

PCCC is part of the overall Non-VA Medical Care Program.  It will provide all VA facilities with an additional option to purchase non-VA medical care when required Veteran care services are unavailable within the VA medical facility or when the Veterans benefit from receiving the needed care nearer to their homes.
Among the many benefits to the Veterans and VA under these new contracts, VA will enjoy standardized health care quality metrics, timely return of medical documentation, cost avoidance with fixed rates for services across the board, guaranteed access to care, and enhanced tracking and reporting of non-VA medical care expenditures over traditional non-VA medical care services.

NASA ANNOUNCES PARTNERSHIP TO ADVANCE COMPOSITE MATERIALS RESEARCH

FROM:  NASA 

NASA Announces Advanced Composite Research Partnership
NASA has selected six companies from five U.S. states to participate in a government-and-industry partnership to advance composite materials research and certification.

The companies are:
• Bell Helicopter Textron Inc. of Fort Worth, Texas
• GE Aviation of Cincinnati
• Lockheed Martin Aeronautics Company of Palmdale, Calif.
• Northrop Grumman Aerospace Systems of Redondo Beach, Calif.
• Boeing Research & Technology of St. Louis
• United Technologies Corporation and subsidiary Pratt & Whitney of Hartford, Conn.

They were selected from 20 proposals submitted by teams from industry and academia in response to a call from the Advanced Composites Project, which is part of NASA's Aeronautics Research Mission Directorate's Integrated Systems Research Program. The project sought proposals to reduce the time for development, verification and regulatory acceptance of new composite materials and structures.

A panel of experts from NASA, the Federal Aviation Administration and the U.S. Air Force Research Laboratory reviewed the submissions and assessed them according to specific criteria. The six firms were chosen for their technical expertise, willingness and ability to share in costs, certification experience with government agencies, focused technology areas and partnership histories.
The first task for the partners is to develop articles of collaboration and establish how the alliance will work and how companies may be added in the future.

SECRETARY OF STATE KERRY'S REMARKS AT FRIENDS OF SYRIAN PEOPLE MINISTERIAL

FROM:  U.S. STATE DEPARTMENT 
Remarks at the Friends of the Syrian People Ministerial
Remarks
John Kerry
Secretary of State
New York City
September 26, 2013

SECRETARY KERRY: (In progress) We’re deeply grateful, all of us, for your having played a critical role – the critical role in inviting us here, in bringing us here. And I’m very pleased that President Jarba of the Syrian Opposition Council is here with us in New York. I think it’s very fitting that President Jarba was raised in Al-Hasakah, because that’s a part of Syria where Arabs, Kurds, the Syrians, and Armenians learned from one another for centuries. That foundation for pluralism and partnership has tragically been torn apart by the conflict that is now ravaging the country, a conflict which even as we have moved to try to separate the chemical weapons, must imperatively demand all of our attention.

We have, all of us, come to know too well an Assad who kills indiscriminately, who bombs women and children, Scud missiles on hospitals, artillery destroying students in a university. Millions of people displaced, millions of people refugeed, huge tensions on the surrounding countries, all of it for Assad to stay in power – a man who has lost any legitimacy to govern.

President Jarba understands that Syria can have a different future. And he understands that Syria can be a nation defined not by this kind of chaos and personal ambition and recklessness, but defined by its rich history of diversity – not by the forces that are content to destroy them. And through our close partnership with the Syrian Opposition Coalition, the legitimate representative, we believe, of the Syrian people, we can lay the foundation for a peaceful Syria where all Syrians have a say and a shape in a shared future.

The Syrian Opposition Coalition’s recent endorsement of Geneva 2 is a critical part of that effort, and I want to commend them for their support. I think almost everybody here has decided there is no military victory. Syria will implode long before any side could claim a military victory. And the fact is there is a process already in place, called Geneva 1, which our friends the Russians have signed on to, which calls for a transition government with quite detailed procedures about how you would have a constitutional process and election, and how Syrians would be able then to choose for the future of Syria. This is a transitional government that must be chosen by mutual consent. And there isn’t anybody in the world who believes that Assad would ever get the consent to be part of such a government.

So we need to move rapidly to put this process in place – a process which already calls for credible elections through that Geneva communique. So we intend to push very hard. We will have a meeting with Lakhdar Brahimi this Friday. I hope we will get this Geneva conference moving. Not that we have an illusion that it may resolve itself in days or even weeks, or perhaps months, but that process must begin so that the world knows we’re paying attention to the crisis of Syria, that it’s unacceptable that it continue in its current status, and that there is a road forward providing that Assad and the people who support him are willing to embrace what the international community has already adopted.

As we invest in the political track, the United States of America will remain steadfast in our efforts to have an impact on the balance on the ground. And we will continue to support the opposition, hopefully thereby moving us closer to a negotiated settlement.

We’ve seen what we’re up against, and we understand the urgency of our working together. There is no way to turn our backs on the nature of the attack that took place on August 21st, an attack that took so many lives in the dead of night because Assad was prepared to use a weapon that has been outlawed and not used in time of war since 1925. That death toll is added to the death toll of already 100,000, and unless all of us make clear our determination to assist the Syrian Opposition Coalition and to help move towards Geneva, that death toll will be added to, with grim figures that could even reach to 200,000, before the international community has applied the lessons that we’ve learned.

After Rwanda, we said never again. After World War II, we said never again. I think the words “never again” need to have meaning. So as we go forward, I’m glad to say to you that this afternoon, Foreign Minister Lavrov and I reached an agreement, which we need to run by our colleagues, with respect to the potential of a resolution. And our hope is that the Security Council will pass a resolution that will make binding and enforceable the removal of the chemical weapons.

But none of us can approach this with an understanding or a belief that just removing the chemical weapons absolves us of our responsibility to deal with the humanitarian crisis, and frankly, a crisis of multilateralism, a crisis of international institutions. We must help bring about a negotiated solution.

We believe we have a strong partner in President Jarba as we pursue these efforts, and it’s our great hope that the pluralism and the partnership that once defined his homeland, the secularity that defines his homeland, will define Syria for all of its citizens in the years to come. And we will do everything in our power to help provide that foundation.

Thank you, Mr. Foreign Minister.

West Wing Week 09/27/13 or, "42 44" | The White House

West Wing Week 09/27/13 or, "42 44" | The White House

EPA EVALUATES SAFER, ALTERNATIVE FLAME RETARDANT CHEMICALS

FROM:  ENVIRONMENTAL PROTECTION AGENCY 
September 24, 2013
EPA Evaluates Flame Retardants Including a Safer Substitute for HBCD

WASHINGTON — As part of its ongoing efforts to promote the design and use of safer chemicals, today, the U.S. Environmental Protection Agency (EPA) has released a draft report on alternatives to a flame retardant chemical, hexabromocyclododecane (HBCD), which has persistent, bioaccumulative and toxic characteristics. The findings in the report can help manufacturers identify safer alternatives to the use of HBCD in polystyrene building insulation.

“While EPA continues to support much needed reform of the Toxics Substances Control Act (TSCA), EPA is taking steps now to address the public’s concern with certain flame retardant chemicals, including making information available to companies to help them make decisions on safer chemicals,” said Jim Jones, EPA's assistant administrator for the Office of Chemical Safety and Pollution Prevention. “The conclusions in this report are enabling companies who choose to move away from HBCD to do so with confidence that the potential for unintended consequences is minimized.”

The Design for the Environment (DfE) Alternatives Assessment draft report, developed with stakeholder and public participation, describes the uses of HBCD with an overview of life cycle and exposure information. The report identifies two viable chemical alternatives for use in polystyrene building insulation, in addition to a list of substances that are not currently expected to be viable. One of the alternatives, a butadiene styrene brominated copolymer, is anticipated to be safer than HBCD and is currently in commercial production in the U.S.  Alternative materials are also identified in the report.

In March 2013, as part of a broader effort to address flame retardant chemicals, EPA identified 20 flame retardants for risk assessment under the TSCA work plan. This includes developing full risk assessments on four of these chemicals, including HBCD.  EPA will use the information from these full assessments to better understand chemicals with similar structures and characteristics. If EPA identifies potential risks, the agency will evaluate and pursue appropriate risk reduction actions. EPA will begin development of these risk assessments later this year and anticipates making the draft risk assessments available for public comment and peer review in 2014.

To further assist companies in selecting safer chemicals, EPA recently launched ChemView, a web-based tool designed to provide the public and decision-makers with a single access point to a wide array of chemical data, like the results of the HBCD alternatives assessment, that can help companies make decisions on developing and using safer chemicals in the products they manufacture.

UNEMPLOYMENT INSURANCE WEEKLY CLAIMS REPORT FOR WEEK ENDING SEPTEMBER 21, 2013

FROM:  U.S. DEPARTMENT OF LABOR


          SEASONALLY ADJUSTED DATA

In the week ending September 21, the advance figure for seasonally adjusted initial claims was 305,000, a decrease of 5,000 from the previous week's revised figure of 310,000. The 4-week moving average was 308,000, a decrease of 7,000 from the previous week's revised average of 315,000.

The advance seasonally adjusted insured unemployment rate was 2.2 percent for the week ending September 14, an increase of 0.1 percentage point from the prior week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending September 14 was 2,823,000, an increase of 35,000 from the preceding week's revised level of 2,788,000. The 4-week moving average was 2,842,500, a decrease of 42,750 from the preceding week's revised average of 2,885,250.

UNADJUSTED DATA

The advance number of actual initial claims under state programs, unadjusted, totaled 253,668 in the week ending September 21, a decrease of 19,250 from the previous week. There were 303,685 initial claims in the comparable week in 2012.

The advance unadjusted insured unemployment rate was 1.9 percent during the week ending September 14, unchanged from the prior week's unrevised rate. The advance unadjusted number for persons claiming UI benefits in state programs totaled 2,464,570, a decrease of 41,762 from the preceding week's revised level of 2,506,332. A year earlier, the rate was 2.2 percent and the volume was 2,841,521.

The total number of people claiming benefits in all programs for the week ending September 7 was 3,921,399, an increase of 22,769 from the previous week. There were 5,173,998 persons claiming benefits in all programs in the comparable week in 2012.

No state was triggered "on" the Extended Benefits program during the week ending September 7.

Initial claims for UI benefits filed by former Federal civilian employees totaled 1,133 in the week ending September 14, an increase of 206 from the prior week. There were 2,155 initial claims filed by newly discharged veterans, an increase of 82 from the preceding week.

There were 19,020 former Federal civilian employees claiming UI benefits for the week ending September 7, an increase of 369 from the previous week. Newly discharged veterans claiming benefits totaled 31,341, an increase of 45 from the prior week.

States reported 1,348,526 persons claiming Emergency Unemployment Compensation (EUC) benefits for the week ending September 7, an increase of 32,563 from the prior week. There were 2,160,448 persons claiming EUC in the comparable week in 2012. EUC weekly claims include first, second, third, and fourth tier activity.

The highest insured unemployment rates in the week ending September 14 were in Puerto Rico (4.2), New Jersey (3.4), Alaska (3.3), Virgin Islands (3.1), Connecticut (2.9), New Mexico (2.9), Pennsylvania (2.8), Nevada (2.6), New York (2.6), and Illinois (2.5).

The largest increases in initial claims for the week ending September 14 were in California (+22,611), Florida (+3,946), Georgia (+2,690), Nevada (+2,504), and New York (+1,871), while the largest decreases were in Oklahoma (-439), Tennessee (-404), Kansas (-351), Massachusetts (-304), and Idaho (-294).

ICAP BROKERS FACE FELONY CHARGES FOR ALLEGED LONG-RUNNING MANIPULATION OF LIBOR INTEREST RATES

FROM:  U.S. JUSTICE DEPARTMENT 

WASHINGTON — Two former derivatives brokers and a former cash broker employed by London-based brokerage firm ICAP were charged as part of the ongoing criminal investigation into the manipulation of the London Interbank Offered Rate (LIBOR), the Justice Department announced today.

Darrell Read, who resides in New Zealand, and Daniel Wilkinson and Colin Goodman, both of England, were charged with conspiracy to commit wire fraud and two counts of wire fraud in a criminal complaint unsealed in Manhattan federal court earlier today. They each face a maximum penalty of 30 years in prison for each count upon conviction.

“By allegedly participating in a scheme to manipulate benchmark interest rates for financial gain, these defendants undermined the integrity of the global markets,” said Attorney General Eric Holder. “They were supposed to be honest brokers, but instead, they put their own financial interests ahead of that larger responsibility.  And as a result, transactions and financial products around the world were compromised, because they were tied to a rate that was distorted due to the brokers’ dishonesty.  These charges underscore the Justice Department’s determination to hold accountable all those whose conduct threatens the integrity of our financial markets.”

“These three men are accused of repeatedly and deliberately spreading false information to banks and investors around the world in order to fraudulently move the market and help their client fleece his counterparties,” said Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division.  “Our criminal investigation of the manipulation of LIBOR by some of the largest banks in the world has led us from New York to London, to Tokyo, and other financial hubs around the globe.  These important charges are just the latest law-enforcement action in the Criminal Division and Antitrust Division’s global LIBOR investigation, and reflect the Department’s continued dedication to detecting, and prosecuting, financial fraudsters who affect U.S. markets, whether they work at a bank, or a brokerage, and whether they carry out their fraud from a desk in the United States, or abroad.”
“The complaint unsealed today charges Colin Goodman, Daniel Wilkinson and Darrell Read for conspiring to manipulate benchmark interest rates that determined the profitability of their client’s trades,” said Scott D. Hammond, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program.  “In exchange for bigger bonus checks, the three defendants undermined financial markets around the world by compromising the integrity of globally used interest rate benchmarks.  The Department continues to demonstrate its commitment to protecting the interest of American citizens in free and fair financial markets.”

“Corporate and securities fraud involving the manipulation of these rates causes a worldwide impact on trading positions and erodes the integrity of the market and confidence in Wall Street,” said Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office.  “Unraveling such complex financial schemes is difficult and time consuming.  Today’s charges are the result of the hard work of the FBI special agents and forensic accountants who dedicated significant time and resources to investigating this case.”

According to the criminal complaint, LIBOR is an average interest rate, calculated based on submissions from leading banks around the world, reflecting the rates those banks believe they would be charged if borrowing from other banks.  LIBOR is published by the British Bankers’ Association (BBA), a trade association based in London.  At the time relevant to the criminal complaint, LIBOR was calculated for 10 currencies at 15 borrowing periods, known as maturities, ranging from overnight to one year.  The published LIBOR “fix” for a given currency at a specific maturity is the result of a calculation based upon submissions from a panel of banks for that currency (the contributor panel) selected by the BBA.

LIBOR serves as the primary benchmark for short-term interest rates globally and is used as a reference rate for many interest rate contracts, mortgages, credit cards, student loans and other consumer lending products.  The Bank of International Settlements estimated that as of the second half of 2009, outstanding interest rate contracts were estimated at approximately $450 trillion.

According to allegations in the criminal complaint filed in this case, between July 2006 and September 2010, Wilkinson was a desk director employed in the London office of ICAP, where he supervised a group of derivatives brokers – including Read – specializing in Yen-based financial products.  Generally, the desk’s clients were derivatives traders at large financial institutions, and the transactions brokered by Wilkinson, Read and others on the desk essentially consisted of bets between traders on the direction in which Yen LIBOR would move.  Between July 2006 and September 2009, the desk’s largest client was a senior trader at UBS (UBS Trader) in Tokyo, to whom Read spoke almost daily.  Because of the large size of the client’s trading positions, even slight moves of a fraction of a percent in Yen LIBOR could generate large profits.  For example, UBS Trader once told Read that a 0.01 percent – or one basis point – movement in the final Yen LIBOR fixing on a specific date could result in $3 million profit for his trading positions.  A significant part of both Read’s and Wilkinson’s compensation was tied to the brokerage fees generated by UBS Trader and paid to ICAP.

Goodman was a cash broker at ICAP’s London office during the relevant time period.  In addition to brokering cash transactions, Goodman distributed a daily email to individuals outside of ICAP, including derivatives traders at several large banks as well as those responsible for providing the BBA with LIBOR submissions at certain banks.  Goodman’s email contained what was termed his “SUGGESTED LIBORS,” purported predictions of where Yen LIBOR ultimately would fix each day across eight specified borrowing periods.  Read and Wilkinson, along with Goodman himself, often referred to Goodman as “lord libor.”

The complaint alleges that Read, Wilkinson and Goodman, together with UBS Trader, executed a sustained and systematic scheme to move Yen LIBOR in a direction favorable to UBS Trader’s trading positions.

According to the criminal complaint, the primary strategy employed by Read, Wilkinson and Goodman to execute the scheme was to use Goodman’s “SUGGESTED LIBORS” email to disseminate misinformation to Yen LIBOR panel banks in hopes that the banks would rely on the misinformation when making their own respective Yen LIBOR submissions to the BBA for inclusion in the published fix.  Rather than providing good faith predictions as to where Yen LIBOR would fix, Goodman instead often used his daily email to set forth predictions which benefitted UBS Trader’s trading positions.

Beginning in or about June 2007, Goodman was paid a bonus through the desk Wilkinson supervised, allegedly intended, at least in part, to reward Goodman for his role in their effort to influence and manipulate the published Yen LIBOR fix.

As a second strategy, Read and Wilkinson allegedly further agreed to contact interest rate derivatives traders and submitters employed at Yen LIBOR panel banks in an effort to cause them to make false and misleading submissions to the BBA at UBS Trader’s behest.

As alleged in the charging document, Read, Wilkinson, Goodman, UBS Trader, and other co-conspirators often executed their scheme through electronic chats and email exchanges.  For example, on June 28, 2007, in an email message, Read told Wilkinson: “DAN THIS IS GETTING SERIOUS [UBS TRADER] IS NOT HAPPY WITH THE WAY THINGS ARE PROGRESSING . . . CAN YOU PLEASE GET HOLD OF COLIN AND GET HIM TO SEND OUT 6 MOS LIBOR AT 0.865 AND TO GET HIS BANKS SETTING IT HIGH. THIS IS VERY IMPORTANT BECAUSE [UBS TRADER] IS QUESTIONING MY (AND OUR) WORTH.”

The complaint alleges that the defendants were aware of the effects that Goodman’s false and fraudulent “SUGGESTED LIBORS” had on submissions by Yen LIBOR panel banks.  For example, on Nov. 20, 2008, Read asked UBS Trader, “you have a really big fix tonight I believe? if Colin sends out 6m at a more realistic level than 1.10 [%] i reckon [the two panel banks] will parrot him, it might mean 6m coming down a bit.” On the following day, Nov. 21, 2008, Goodman moved his suggestion for 6-month Yen LIBOR down by nine basis points.  The two other banks mirrored Goodman’s suggestion, moving their 6-month Yen LIBOR submissions down by nine basis points.

According to allegations in the complaint, Read counseled UBS Trader how to most effectively manipulate Yen LIBOR.  For example, UBS Trader told Read in a July 22, 2009, electronic chat that “11th aug is the big date...i still have lots of 6m fixings till the 10th.”   Read responded to UBS Trader, “if you drop [UBS’s] 6m dramatically on the 11th mate, it will look v fishy... .  I’d be v careful how you play it, there might be cause for a drop as you cross into a new month but a couple of weeks in might get people questioning you.”  UBS Trader replied, “don’t worry will stagger the drops...ie 5bp then 5bp,” and Read told UBS Trader, “ok mate, don’t want you getting into [expletive].”  UBS Trader again assured Read that UBS and two additional panel banks would stagger their drops in coordination, and Read concluded, “great the plan is hatched and sounds sensible.”

A criminal complaint is a formal accusation of criminal conduct, not evidence.  A defendant is presumed innocent unless and until convicted.

The investigation is being conducted by special agents, forensic accountants, and intelligence analysts of the FBI’s Washington Field Office.  The prosecution is being handled by Deputy Chief William Stellmach and Trial Attorney Sandra L. Moser of the Criminal Division’s Fraud Section and Trial Attorneys Eric Schleef and Kristina Srica of the Antitrust Division.  Trial Attorneys Alexander Berlin and Thomas B.W. Hall, Law Clerk Andrew Tyler, and Paralegal Specialist Kevin Sitarski of the Criminal Division’s Fraud Section, along with Assistant Chief Elizabeth Prewitt and Trial Attorney Richard Powers of the Antitrust Division, and former Trial Attorney Luke Marsh have also provided valuable assistance.  The Criminal Division’s Office of International Affairs has provided assistance in this matter as well.

The broader investigation relating to LIBOR and other benchmark rates has required, and has greatly benefited from, a diligent and wide-ranging cooperative effort among various enforcement agencies both in the United States and abroad.  The Justice Department acknowledges and expresses its deep appreciation for this assistance.  In particular, the Commodity Futures Trading Commission’s Division of Enforcement referred this matter to the Department and, along with the U.K. Financial Conduct Authority, has played a major role in the investigation.  The Securities and Exchange Commission has also provided valuable assistance for which the Department is grateful.  The Department also expresses its appreciation to the United Kingdom’s Serious Fraud Office for its assistance and ongoing cooperation.  Various agencies and enforcement authorities from other nations are also participating in different aspects of the broader investigation, and the Department is grateful for their cooperation and assistance as well.

Finally, the Department acknowledges ICAP’s continuing cooperation in the Department’s ongoing investigation.

This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force.  President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.  The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes.